Impossible to look after each and every branch of a bank: RBI guv to parliamentary panel

During the course of the session, the RBI governor once again reiterated that the RBI has “inadequate” control over PSBs and asked for more powers to oversee the operations at government-owned banks, said sources who are aware of the discussions. As of now, there are 21 state-owned lenders in India, including the State Bank of India.

File Photo &nbsp | &nbspPhoto Credit:&nbspBCCL

New Delhi: Reserve Bank of India Governor Urjit Patel on Tuesday told a special parliamentary panel that the top bank does not have the authority to intricately examine the functioning of all banks in the country, especially state-run lenders. Appearing before the Parliamentary Standing Committee of Finance, led by Congress leader Veerappa Moily, Patel was subjected to several tough questions from lawmakers on bad loans, bank frauds, cash crunch and issue of rising NPAs.

During the course of the session, the RBI governor once again reiterated that the RBI has “inadequate” control over PSBs and asked for more powers to oversee the operations at government-owned banks, said sources who are aware of the discussions. As of now, there are 21 state-owned lenders in India, including the State Bank of India.

It is worth mentioning that the combined losses of these banks crossed a whopping Rs 87,300 crore in 2017-18 and was topped by fraud-hit PNB whose losses were in excess of Rs 13,000 crore. It may be noted that out of the 21 PSBs, only two banks – Indian Bank and Vijaya Bank, posted profits in FY18.

While answering questions related to the Rs 13,600 crore Nirav Modi scam, the RBI governor said it was impossible for the top bank to “look after each and every branch of a bank in terms of audit”.

However, Patel was optimistic about the recovery adding that the authorities are confident that they will be able to tide over the crisis. It remains to be seen if banks can stage a recovery through resolution process under the Insolvency and Bankruptcy Code.

Impossible to look after each and every branch of a bank: RBI guv to parliamentary panelDescription:During the course of the session, the RBI governor once again reiterated that the RBI has “inadequate” control over PSBs and asked for more powers to oversee the operations at government-owned banks, said sources who are aware of the discussions. As of now, there are 21 state-owned lenders in India, including the State Bank of India. Times Now